Vail Resorts is buying Peak Resorts.

[cdskier]

The board (in general) doesn't stand to make any money on it as they are only paid a retainer to begin with. However if they are Inside Directors (Officers, major shareholder reps) then they could... Without going into SEC filings it's hard to see who on the board is a major stakeholder or not.

The non-employee Directors were paid 75K as their retainer...half in cash and half in restricted stock units. So those 4 directors now have between 30 and 43K restricted shares. Those 4 combined have about a 1% stake in the company while if you include the executive officers the overall stake of the board increases to 11%. (That doesn't include the 9th director who has no direct stake, but represents Cap 1 which obviously has a huge stake as they own all the preferred stock).

 

[cdskier]

The board (in general) doesn't stand to make any money on it as they are only paid a retainer to begin with. However if they are Inside Directors (Officers, major shareholder reps) then they could... Without going into SEC filings it's hard to see who on the board is a major stakeholder or not.

I just re-read the complaint again and it seems to be more the future plan for the executive officers that the plaintiff is concerned about. The compensation the board members would receive was disclosed, but not whether there were discussions on whether any of current management was offered jobs by Vail post-merger. So the plaintiff alleges that they could have been given offers in the new company that are swaying their opinion on the merger recommendation to shareholders (I think). Is that type of information about future employment of management usually disclosed publicly as part of a merger?

 

[Domeskier]

Is that type of information about future employment of management usually disclosed publicly as part of a merger?

Yes. Anything that a reasonable shareholder would consider important in deciding how to vote has to be disclosed. This is a typical nuisance suit that will benefit no one except the plaintiff's counsel. They want to settle quickly for a few $100K in legal fees, which the defendants are likely to pay because they don't want to hold up the closing and the amounts involved are just a rounding error to them.

 

[cdskier]

Yes. Anything that a reasonable shareholder would consider important in deciding how to vote has to be disclosed. This is a typical nuisance suit that will benefit no one except the plaintiff's counsel. They want to settle quickly for a few $100K in legal fees, which the defendants are likely to pay because they don't want to hold up the closing and the amounts involved are just a rounding error to them.

What's the actual motivation for the plaintiff to file something like this anyway? Is he getting a kickback from his lawyer somehow? The guy probably has a fraction of a percent of the shares in Peaks and no matter what is ultimately disclosed chances are they'll have no problem getting enough shareholder votes anyway for the merger to proceed.

 

[Domeskier]

What's the actual motivation for the plaintiff to file something like this anyway? Is he getting a kickback from his lawyer somehow? The guy probably has a fraction of a percent of the shares in Peaks and no matter what is ultimately disclosed chances are they'll have no problem getting enough shareholder votes anyway for the merger to proceed.

The plaintiffs are typically recruited by the firms. It could be a family member or friend of the attorney or an entity specifically created by the attorney to file the suit. The plaintiffs have no involvement in the cases and are not paying legal fees. There are frequent allegations of kickbacks. Securities litigation is a sordid industry filled with unscrupulous bottom-feeders.

 

[BenedictGomez]

Is that type of information about future employment of management usually disclosed publicly as part of a merger?

Absolutely. If not, the potential shenanigans are only limited by what the nefarious mind may dream.

 

[cdskier]

Absolutely. If not, the potential shenanigans are only limited by what the nefarious mind may dream.

I was thinking that meant they had to have made decisions definitively about who they were keeping which seemed a bit odd to me as I would think you wouldn't necessarily always know that until closer to the closing date, but in looking at some other proxy statements related to mergers it seems sometimes they say something like this:

As of the date of this proxy statement, none of our executive officers has entered into any agreement with Parent or any of its affiliates regarding employment with, or the right to purchase or participate in the equity of, the Surviving Corporation or one or more of its affiliates. Prior to and following the closing of the Merger, however, certain of our executive officers may have discussions with, and following the closing of the Merger, may enter into agreements with, Parent or Merger Sub, their subsidiaries or their respective affiliates regarding employment with, or the right to purchase or participate in the equity of, the Surviving Corporation or one or more of its affiliates.

Obviously the statement would need to be truthful, but now seeing you can say that "nothing has been decided yet but that could change before the closing" satisfies the questions I had in my mind about what happens if you don't know.

 

[drjeff]

I think one other thing to keep in mind, and why likely initially, Vail Resorts is likely to keep the vast majority of current Peak employees, is that while Vail Resorts has certainly had times in the past where on the day a deal closed they had to integrate multiple resorts into their system, never had they had to simultaneously integrate SEVENTEEN resorts into their system. Even for Vail Resorts, that's going to take a lot of manpower and require them to learn a bunch of data about all of those properties, data that working knowledge of what was done before will likely help the integration go as seamlessly as possible.

Sent from my Moto Z (2) using AlpineZone mobile app

 

[BenedictGomez]

I think one other thing to keep in mind, and why likely initially, Vail Resorts is likely to keep the vast majority of current Peak employees

It's near certain that they will do so using history as a guide, but especially given a fall closing; 2020 is when the reckoning takes place.

 

[FBGM]

It's near certain that they will do so using history as a guide, but especially given a fall closing; 2020 is when the reckoning takes place.

Anyone with a title close to marketing manager, director of marketing - yeah you’re gone.

Anyone in payroll, AP, - that type of thing - your department is getting thinned

Anyone with a higher pay scale then the Vail model shows - you’re gone

 

[AdironRider]

Anyone with a title close to marketing manager, director of marketing - yeah you’re gone.

Anyone in payroll, AP, - that type of thing - your department is getting thinned

Anyone with a higher pay scale then the Vail model shows - you’re gone

Realistically, with Peak already being a 17 resort consortium, this consolidation already happened and Vail will still have to keep up with the additional volume, so a lot of these jobs are safe.

 

[BenedictGomez]

Realistically, with Peak already being a 17 resort consortium, this consolidation already happened and Vail will still have to keep up with the additional volume, so a lot of these jobs are safe.

Ski jobs yes, but I agree that the sales and marketing folks are mostly toast. Same with accounts payable, accounts receivable, finance, accounting, human resources, etc... Roles like that. Not all of those roles of course, but at the very least, of the roles "saved", my guess is plenty will be forced to either move to Colorado or take a hike, and most wont relocate their family cross-coast, which is effectively the same as losing your job.

 

[Newpylong]

The individual mountains still handle their AR/AP, HR, Payroll, etc and so on. There are some economies of scale of being in Peak or Vail resorts but most of that revolves around marketing and sales - which I suspect will see the most change.

 

[BenedictGomez]

The individual mountains still handle their AR/AP, HR, Payroll, etc and so on.

Do you know this as a fact?

Frankly, I'd be pretty surprised if Vail handles their own payroll as they are ruthlessly efficient with the bottom-line, and it's far cheaper to outsource that to someone like ADP.

AP too, it's far cheaper to just outsource that to India & have invoices emailed to a VailResorts.com email address to a person in New Delhi than having to pay numerous human beings a salary, medical, benefits, etc...

 

[Newpylong]

Sorry I meant Peaks. Yes you are correct, Vail mountains - everything is out of Colorado - HR, Payroll, AR, AP, etc.

ADP, Paychex, etc is not as cheap as you think for shops with large # of employees, it often makes sense to handle internally.

 

[AdironRider]

Do you know this as a fact?

Frankly, I'd be pretty surprised if Vail handles their own payroll as they are ruthlessly efficient with the bottom-line, and it's far cheaper to outsource that to someone like ADP.

AP too, it's far cheaper to just outsource that to India & have invoices emailed to a VailResorts.com email address to a person in New Delhi than having to pay numerous human beings a salary, medical, benefits, etc...

Yeah I actually do know this stuff as a fact. Good luck getting good ol boy mountain town contractors and vendors that are willing to put up with some guy in India who barely speaks English. It doesn't work out. I've seen that rodeo before and it lasts no more than a year when your subcontractors all bail on you because some dude in India is giving them a hard time.

All of these mountains are still going to have GMs. All of these mountains are still going to need a marketing manager and staff to schmooze and oversee events hosted at the mountain. All of these mountains are going to have HR people to onboard hundreds of seasonal employees. ADP still needs 'timesheets' to process their payroll and those timesheets need to be audited by a human on site.

Peak was a large organization and again, have already captured these economies of scale. The only people who are going to be sweating this are the C Suite execs are Peak (CEO/CFO/VP Marketing), and they won't be sweating at all as they will get cushy buyout packages.

Frankly, you do not know of which you speak on these matters.

 

[abc]

Both of you are right.

I've seen so many mergers I could almost call myself a "merger specialist". Mind you, not the merger itself, but for being the cavalry galloping in to help after the merge.

What typically happens is the existing employee got insecure and start looking for another job. In a good market, which merger typically happens, any worker who can do a half decent job easily found other employers and left. All of a sudden, the outfit had severe shortage of essential staff to run their day to day operation. That's when I got pulled in to help, quick!

At first, I thought I'd be gone once they fully merged. But as the pay was typically much elevated, I happily oblige. But as I found out one company after another, the actual merge of separate systems takes way longer than anticipated. By the time all the kinks got worked out, I became such an "inside expert" of the outfit they want me to stay on! Though for me, I typically don't because it's more lucrative to gallop to the next merger victim who're willing to pay extra...

Eventually, some of the old workers would be laid off. Specially those who couldn't find any alternatives. Basically, those they had wanted to get rid of but couldn't find a good excuse. The merger provides the perfect excuse to get rid of people whom they should have gotten rid of long ago.

 

[Newpylong]

Yeah I actually do know this stuff as a fact. Good luck getting good ol boy mountain town contractors and vendors that are willing to put up with some guy in India who barely speaks English. It doesn't work out. I've seen that rodeo before and it lasts no more than a year when your subcontractors all bail on you because some dude in India is giving them a hard time.

All of these mountains are still going to have GMs. All of these mountains are still going to need a marketing manager and staff to schmooze and oversee events hosted at the mountain. All of these mountains are going to have HR people to onboard hundreds of seasonal employees. ADP still needs 'timesheets' to process their payroll and those timesheets need to be audited by a human on site.

Peak was a large organization and again, have already captured these economies of scale. The only people who are going to be sweating this are the C Suite execs are Peak (CEO/CFO/VP Marketing), and they won't be sweating at all as they will get cushy buyout packages.

Frankly, you do not know of which you speak on these matters.

Actually none of the Vail resorts in the East have HR departments anymore. All handled from CO. The worker's managers hand them off once they show up.

 

[AdironRider]

Actually none of the Vail resorts in the East have HR departments anymore. All handled from CO. The worker's managers hand them off once they show up.

Bull, Okemo alone is hiring several HR positions currently right in Ludlow, including an employee housing manager type and HR coordinator. Stowe is doing the same as well.

You guys are seriously underestimating just how much hands on labor it takes to operate a completely seasonal operation with incredibly high turnover.

Again though, the point is Peak was already a 17 mountain beast of a ski resort company. These consolidations (if necessary at all) have already occurred and what is left probably isn't going anywhere.

If this was a one off mountain purchase (ala if they were to buy Jackson Hole for example) there would be more cuts, but that is not the case here.

 

[Newpylong]

Coordinators perhaps, certainly not a full fledged HR department anymore. I was leaving Sunapee right when I read this thread and asked their Director of Operations, and he said all of the aforementioned items are handled right out of CO now. It wouldn't surprise me that Okemo and Stowe given their size need a local presence that perhaps was inadequate.

I certainly am not underestimating, I ran a mountain with only 30 something odd seasonal employees and that was hard enough. Was just stating the state of Vail as I know it in the East.

I do know local management, even a year after joining Vail, are still fairly in the dark about what the long term plans are. These are a lot of children joining the family quickly.